Tax Deed Sales

General Real Estate Investing
1

I was wondering if anyone out there has bought property from a tax deed sale and if this was a good way to invest?

Also if anyone has:

  1. Do you know if there is a time limit after purchase before you can put in on the market?

  2. Do you have to hold the property for a certain amount of time giving the owner the option to pay off the taxes?

Thanks in Advance,
Tammy

2

Ted Thomas is the king of tax sales. I’m sure you can pick up some of his stuff on ebay pretty cheap.

3

Howdy Tammy2068:

A couple of points about Tax Deed Sales;

The owner has the right to redeem for at least 6 months and 2 years if their homestead at least here in Texas and other as well. This will limit the marketability of the property as you can not give the new buyer clear title. Also you will have a hard time finding a title company that will insure the title because the owners could possibly file a claim against them.

The good news is if they do redeem the property they have to pay you 25% interest for your trouble. If you pay $10,000 for a deal and they redeem you will get $12,500 day one or day 365 and another 25% on day 366 or longer until the end of the second year (Texas).

Be prepared to pay cash without a loan or title policy if you buy from a tax sale.

4

Can properties be found that are not Homesteaded?
And is so is there a wait time on these as well?
Also can you live in these houses while you are waiting the 2 years 6 months?

Tammy ???

5

Howdy Tammy:

Yes there are non homestead sales properties sold every month. The redemption time in Texas is 6 months for these. Yes you can live in them. The owner does not have to pay you back for repairs if they redeem the property except under extreme circumstances like roof leaking and doing more damage to the interior and possibly other emergency fixes.

You have all the legal rights of ownership except the redemption rights that the owner has. If you can find them you may be able to get the deed from them and then you will not have to worry about the redemption rights and it would be easier to get title insurance.